Alabama Community Development Block Grant (CDBG) - Economic Development Fund

The Economic Development Fund (EDF) under the Community Development Block Grant (CDBG) program is administered by the Alabama Department of Economic and Community Affairs (ADECA). Established in 1982, the CDBG program is federally funded by the U.S. Department of Housing and Urban Development (HUD) and implemented at the state level to serve non-entitlement communities—those not receiving direct HUD funding. The purpose of the CDBG program is to enhance community infrastructure, reduce poverty, and stimulate economic growth through targeted investments that support the creation or retention of jobs, particularly benefiting low- and moderate-income populations. The EDF specifically targets economic development projects and is one of several CDBG sub-funds, alongside the Competitive, Community Enhancement, and Planning Funds. The Economic Development Fund is designed to support infrastructure improvements that catalyze job creation or retention in eligible communities. The program requires that applicants demonstrate a firm commitment from a business partner to create or retain at least 15 jobs as a result of the proposed project. Eligible projects typically involve water, sewer, and road improvements, as well as more specialized infrastructure such as rail spurs and docks. These efforts must be linked directly to economic development outcomes, with businesses generally falling within Standard Industrial Classification (SIC) codes 20–39 or otherwise providing significant economic benefit. The fund also includes special financial instruments such as the Economic Development Incubator ($400,000) and Economic Development Float Loans, which can go up to $10 million. To ensure responsible use of funds and alignment with economic development goals, ADECA enforces key program constraints. Notably, all projects must avoid intrastate business relocations and must not commence construction prior to grant award or clearance of environmental review conditions. A local cost share of 20 percent is required, reinforcing local commitment and financial participation in the proposed initiative. The program operates on a continuous funding cycle, allowing applications to be submitted year-round, which provides flexibility for communities to respond to business opportunities in real time. The EDF is not bound by a strict grant ceiling, although a default cap of $400,000 is typically enforced. This ceiling may be waived under certain conditions, providing leeway for more substantial projects where justified by job creation or broader economic impact. Applications are judged primarily on their economic benefit, the number of jobs created or retained, and the financial feasibility and sustainability of the project. While there is no explicitly defined application form or set of questions outlined on the program’s public page, standard CDBG requirements apply, and applicants are expected to work closely with CDBG program staff. Prospective applicants must ensure that their proposed project aligns with the CDBG national objectives, which include benefiting at least 51% low- and moderate-income persons, preventing or eliminating slums and blight, or addressing an urgent community need. Given its open-cycle nature, there is no annual or rolling deadline, and projects are evaluated as they are submitted. Interested communities should contact ADECA’s CDBG staff directly for guidance on application steps and required documentation. The primary contact number provided is (334) 242-0492. For more detailed procedural and eligibility questions, applicants are encouraged to consult additional ADECA resources such as the CDBG Application Manual and Guide to National Objectives. In summary, the Economic Development Fund under Alabama’s CDBG program represents a flexible, infrastructure-focused funding opportunity for communities aiming to support economic growth through job-creating development projects. It is especially well-suited for municipalities able to partner with businesses committed to employment expansion and willing to contribute a meaningful local match. The program’s continuous availability and adaptable ceiling make it a strategic option for time-sensitive economic opportunities.